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Just the tonic! The revival of gin in the UK

Over the past ten years, gin has seen a remarkable revival in the UK. In 2017, more than 47m bottles of gin were served up, enough to make more than 1.32bn G&Ts. Gin is now the nation’s most popular spirit, with UK manufacturers’ sales of gin rocketing by more than 250% since the financial crisis. Gin’s versatility has certainly contributed to its success, with the spirit serving as the base of many common cocktails (think gin martinis, gin gimlets or Negronis). Its different flavours, and the ability to subtly change according to the tonic you add, make it attractive to the younger generation, many of whom want a drink that they can customise and make their own.

Gin and commerce

A number of companies have sought to capitalise on the growing popularity of gin, including established drinks businesses like Diageo, and fast growing start-ups like Fevertree. The latter has benefitted strongly from the ‘premiumisation’ trend, where consumers have gradually traded up to upmarket brands. Indeed, Fevertree can’t really be classed as a start-up anymore, with the company one of the largest on London’s AIM market. Having taken the UK market by storm, Fevertree is now seeking to expand internationally, especially in the US. Many investors continue to expect a strong rate of growth in the years ahead as Fevertree seeks to spread its wings.

Other opportunities include Diageo, an international drinks business which owns Gordon’s and Tanqueray gin, as well as other famous brands like Guinness, Bell’s Whisky and Captain Morgan. Diageo is better known in the investment world as a ‘quality compounder’, a company that can steadily grow it sales over time – regardless of the prevailing economic or political conditions. The company is not immune to making mistakes, but it has delivered consistent performance over time. The best quality compounders are constantly developing their products, with Diageo and gin a good example. Diageo’s launch of Gordon’s Pink, for example, was the most successful new spirits introduction to the UK for ten years, with the company able to reach back to a Victorian Gordon’s recipe to come up with a sweet fruit flavour of raspberries, strawberries, and redcurrants.

How much further does the ‘Ginaissance’ have to go?

While the prominence of upmarket gins and Fevertree tonics might suggest otherwise, we have a long way to go before UK gin consumption reaches its all-time high. The average English person consumed 10 litres of gin a year by the middle of the eighteenth century. That figure stands at just over half a litre today, though other spirits are more widely consumed. Regardless, gin lovers look set to continue enjoying the Ginaissance for some time to come.

 

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